German-American Discourse on Politics and Culture

July 29, 2017

German Industry: Vorsprung durch Korruption

Germans love to lecture other countries - especially the United States - about their moral lapses. But Germany is amazingly incapable - or unwilling- to discover and prosecute corruption at home. It was researchers in the United States - not in Germany - who discovered and blew the whistle on Volkswagen's illegal use of software to falsify pollution emissions data in its diesel engines. And Volkswagen was not alone:

Volkswagen, Audi, and Porsche have been found guilty of fraud by U.S. courts following suits brought by the environmental protection agencies CARB and EPA. A U.S. federal judge ruled in April 2017 that Volkswagen had to pay a "2.8-billion (dollar) criminal fine for rigging diesel-powered vehicles to cheat on government emissions tests."German car makers purportedly also coordinated their emissions strategies in South Korea after Mercedes-Benz models were flagged by local authorities. Their objective was to prevent the introduction of individual tests and registration procedures because German diesel vehicles fell short of regulatory standards.So far, car industry representatives have been reluctant to comment on what they have widely described as "media speculations." BMW has stressed that not all information exchanges between car makers are illegal.

And the emissions scandal is evidently just the "tip of the iceberg." According to Der Spiegel, the giant automakers - along with their chief supplier Bosch- have been engaging in illegal collusion for over a decade:

Nor is this widespread corruption limited to German auto industry. Germany's premier bank - Deutsche Bank AG - is undoubtedly the most corrupt financial institution on the European continent. Deutsche Bank has been at the center of EVERY scandal over the last ten years - from the subprime mortgage meltdown, to LIBOR-fixing, to money-laundering. It was US - not German - bank authorities who uncovered a massive scheme by DB to launder $10 billion in Russian money. It was Deutsche Bank who agreed to lend $300 million to Donald Trump after every US bank refused to touch the corrupt real estate business - even though Trump had previously defaulted on loans from DB. As the investigation into collusion between the Trump campaign and Russia unfolds, Deutsche Bank will be seen to be the central conduit.

It is interesting how much of the corruption by German businesses involve Russia:

Meanwhile, German engineering powerhouse Siemens stands accused of having supplied gas turbines for electricity generators that will enable Russia to open two power stations in occupied Crimea, ending the annexed peninsula’s dependence on energy from Ukraine, from which Moscow seized the region in 2014.Providing power equipment for Crimea violates European Union sanctions, but Siemens says the turbines were diverted by its state-owned Russian client without its knowledge, in breach of contract and despite past warnings from the company.Siemens initially denied a Reuters report this month that two of its turbines had been shipped to Crimea from adjoining southwestern Russia. Then it said it was investigating. Then it admitted the equipment had been moved “against our will” and said it would sue its Russian client, Technopromexport, and its own majority-owned Russian subsidiary, Siemens Gas Turbine Technologies. It now says it is halting the export of all power-generating technology to Russia.

Then again, maybe it's not that surprising when the corruption is facilitated by Germany's top political leaders.